China’s Airbnb rival Tujia receives $300 million for online unit

It seems that China’s online travel and accommodation industry is still feeling the heat from the Golden Week. China’s home rental unicorn Tujia.com, often dubbed the Airbnb of China, announced today that it just completed a $300 million Series E for its online arm at a valuation of over $1.5 billion. The current round marks the first independent financing for Tujia’s online unit since the separation of online and offline departments earlier this year.

Existing investors of Ctrip and All-Stars Investment lead the round. Several new investors participated, including China Renaissance’s New Economy Fund, Glade Brook Capital, an investor in Airbnb and Uber, and G Street Capital.

The fund gives Tujia a lot of firepower in China’s increasingly crowded homestay market. The US sharing economy darling Airbnb doubled down on Chinese market this year with new China head and a Chinese name. There have been rumors that Airbnb is in talks with Tujia and another local apartment rental platform Xiaozhu on capital cooperation.

The money raised from this round would be used both to “work towards optimizing the user experience by standardizing aspects of our alternative travel accommodations such as linen washing, cleanliness, and smart capabilities,” and to “further invest in the domestic high-end real estate market and in foreign markets,” said company founder and CEO Justin Luo in an internal letter.

The company’s latest D and D+ rounds of financing completed in August of 2015, since when the firm has maintained steady growth in its business, he added.

Tujia now claims to cover 345 domestic destinations and 1,037 foreign destinations, with over 650,000 online listings. The Tujia app has been downloaded by over 180 million users as of August 2017, according to the company.

In the span of five years, Tujia has become a leader in the sector through the integration of three rival accommodation booking platforms of Ctrip Homestay, Qunar Homestay, and Mayi.com. The firm has also worked with eLong, WeChat, Baidu, Tongcheng and other partners to build a cooperative distribution network.